Imagine that you get in your car and it starts making a funny sound. Unfortunately your broke and don’t know how you will pay to fix it so you ignore it till payday. Most of us know what that is like and we know it can be stressful. But did you know that situation can actually reduce your cognitive functioning.

Well recent research published in Science magazine shows that it does. In fact the researchers found it impacts cognitive function approximately as much as a night without sleep or being drunk which is about -13 points on IQ.

Right about now you are probably calling BS or at least wondering what evidence I have for my claim. So I will explain. The researchers went to a mall in NJ and gathered a random sample of participants. First the participants were presented with a scenario like this: “Your car is having some trouble and requires $X to be fixed. You can pay in full, take a loan, or take a chance and forego the service at the moment… How would you go about making this decision?” For half of the sample X was $150 and the other half it was $1,500. Then the participants performed a Raven’s matrices test which is a spacial problem solving exercise commonly used in IQ testing to measure “fluid intelligence” (problem solving in novel situations independent of acquired knowledge).

The interesting thing is that participants presented with the high cost scenarios did worse on Raven’s test but only if they happened to have lower income. The wealthier half of the sample performed equally well on Raven’s test regardless if they were presented with the high cost or low cost scenario. While the entire sample (both poor and wealthy) did equally well on Raven’s test when they were presented with the low cost scenario.

Now a critical reader is likely thinking there are a couple problems with those results. The first question is how many people were sampled? The researchers ran the experiment 3 times each with 101, 100 and 96 participants. That is reasonable sample size and each trial replicated the results. Considering the sample size and that the researchers randomly assigned individuals to the high and low cost scenarios we can have good confidence that the scenario caused the reduction in cognitive performance for the lower income participants. Next one may ask what mechanism is causing the results? The researchers propose that “poverty-related concerns consume mental resources, leaving less for other tasks.” Though the exact mechanism is not important since the study design has a high level of internal validity meaning that it allows for attribution of causation. Finally you might be thinking these results are all fine and dandy but do they hold up in the real world?

Well the researchers asked the same question so they ran a variant on the study using a real world situation. Sugar cane farmers in India earn money annually at harvest so they are relatively ‘wealthy’ after harvest and very poor just before harvest. Utilizing this natural occurrence the researchers tested sugar cane farmers using Raven’s test before and after the harvest. The results were the consistent, the same farmer performed worse before harvest and better after harvest. Also to be sure that the extra labor involved in the harvest did not impact cognitive performance they tested some after harvesting but prior to being paid and found they did worse on Raven’s test then and better after being paid. In addition the researchers were concerned that the farmers were learning how to solve Raven’s by being tested twice. So they tested some farmers only once after harvest and found those farmers performed consistent with the other farmers after harvest. This showed that the previous experiment’s results hold up in the real world.

Since the same results could be demonstrated using a controlled experimental design with high internal validity and verified using a real-world field study with high external validity the conclusion is very solid. If you are poor and you have to think about a difficult financial situation it can actually inhibit your cognitive performance.

There are massive implications of this result. Being poor may actually make it more difficult for those that are on welfare or unemployed to get back on their feet. They are functionally operating at a cognitive deficit during that period of their life. They will be more likely to make poor decisions and will find it harder to present well for job interviews and such. Also consider education, poor college students may not be able to perform as well in higher education as their wealthier counterparts since some of their mental resources will be focused on their financial situation. Furthermore poor parents may find it harder to help their children with homework and other cognitive tasks which could impact their children’s ability to do well at school. In addition these results challenge what many people think. It shows at least one clear situation where people are actually not as rational as they could be. So when somebody says that poor people are not as smart as others or that they engage in counter-productive behavior it could be in part caused by their situation and not be a inherent feature of the person. Finally consider that more and more Americans are living in poverty even if they are working. This could inhibit them from getting ahead and achieving the American dream.

This leaves me wondering what other situational factors can influence one’s cognitive function? How stable is your intelligence? How much does your intellectual functioning change based on outside factors? Next time you see somebody and think that they are stupid stop and ask yourself if maybe they are just in a bad situation.